Landed Cost vs Unit Price: Comparing Prototype Quotes for UK and EU Delivery

Compare prototype quotes on landed cost, not unit price. SkillsProto quotes DDP delivery to the UK, EU and US in 3-5 days, with duty and clearance handled inside the price, so the figure on the quotation is the figure that leaves the bank account. Parts are machined in one plant in Shajing, Shenzhen to ±0.005 mm on critical features, MOQ 1, CNC in 3-7 days with a 48-hour expedite, and DFM notes inside 24 hours.

Why the unit price is not the price you pay

A unit price answers one narrow question: what does one part cost before it travels anywhere. It is the number buyers compare, because it sits in the same cell on every quotation. It is also the number that produces a surprise three weeks later, when the forwarder invoices separately, the broker asks for a tariff classification, and finance books a landed figure 30-60% above what was approved.

The gap is structural, not dishonest. A supplier quoting EXW cannot see your freight contract, your broker's fee, or your country's duty treatment of that part. A supplier quoting DDP must price all three. Landed cost is every line between the supplier's gate and your goods-in shelf, divided by the parts that pass inspection.

The six lines that make up delivered cost

• Unit price or tooling amortisation. The part price, or mould cost divided by the shots you actually take.

• Export packing. Foam, VCI bags, crates, pallets. Cheap packing returns later as a damage claim.

• Freight. Shenzhen to your door by courier, air or sea, priced on chargeable weight.

• Duty and import VAT. Set by the destination tariff schedule for the HS code, not by invoice wording.

• Clearance and brokerage. Customs entry, bond, and handling fees on a non-standard classification.

• Inspection and rework risk. First article inspection, plus the cost of a second run if the first fails.

Line six is the one buyers forget. A supplier holding ±0.005 mm on critical features and shipping a dimensional report removes most of that risk. A supplier with a tighter unit price and no inspection record moves the risk to your assembly line, where one out-of-tolerance bore costs more than the batch.

EXW, FOB or DDP: who carries what

Incoterms decide who books what and where risk transfers. They do not change the physical cost, only who pays it and who fixes it when something goes wrong.

Between EXW and DDP the total often lands within 10%, but the work does not. On a 5-part order, the afternoon spent resolving a classification query costs more than the freight difference. SkillsProto quotes DDP as standard for the UK, EU and US, delivered 3-5 days from dispatch, with duty listed separately so finance can reclaim import VAT without chasing anyone.

Duty starts with the HS code, not the invoice total

Duty is charged on the customs value against the tariff rate attached to the HS code. Classify wrongly and the rate is wrong, which means either an overpayment you never recover or a demand six months later.

1. Classification. A machined bracket, a machined heat sink and a machined mould are not the same commodity code. Function and design decide it, not material alone.

2. Destination schedule. The UK Global Tariff and EU TARIC are public. The same code can carry different rates.

3. Origin evidence. Preferential rates need a valid origin statement. A "Made in China" stamp is not origin evidence.

SkillsProto classifies each part before shipping and prints the code on the commercial invoice, so your broker is not guessing. Rates are not quoted here because they depend on code and destination and are revised; verify the current rate against the official schedule for your market.

Quantity breakpoints decide the process, and the freight

Quantity changes which process is economic, and it pushes freight the other way: the cheaper the part, the more likely you ship volume rather than a parcel.

The breakpoint that catches buyers is 100-500 parts. Below it, tooling amortisation loses to machining or vacuum casting. Above it, the tooling pays back inside the first production run. Die casting only becomes relevant from 500 pieces, where tool cost is spread across enough parts to compete with machined equivalents.

Air, courier or sea: matching mode to batch size

Freight is priced on chargeable weight, the greater of actual and volumetric weight. That rule explains why thin-walled aluminium housings can cost more to ship than heavier solid brackets.

On a three-iteration programme, courier at 3-5 days is usually cheaper overall: a 30-day sea transit turns a two-week loop into two months.

A worked comparison of two quotes

The following figures are illustrative and are not a SkillsProto quotation; the structure is the point.

Supplier A quotes USD 8.20 per part EXW for 200 machined brackets. Supplier B quotes USD 9.60 per part DDP. At face value A is 17% cheaper, saving USD 280 across the order.

Now add what A excludes: packing and documentation USD 180, air freight USD 640, duty and clearance USD 310, and a first article inspection your quality team must run at USD 220 because no report ships with the parts. A lands at USD 2,990, or USD 14.95 per part. B lands at USD 1,920, or USD 9.60 per part. The cheaper unit price was 56% more expensive delivered.

Seven checks before you approve the purchase order

1. Same Incoterm on both quotes. Convert everything to DDP before comparing.

2. Freight basis stated. Chargeable weight, mode, and whether the price assumes a pallet or a parcel.

3. HS code on the invoice. Not "aluminium parts"; the actual code and the rate it carries.

4. Duty shown separately. Needed for VAT recovery and to check the rate.

5. Inspection record included. A dimensional report against the drawing, not a conformity certificate alone.

6. Tooling ownership in writing. For moulded parts, confirm who owns the tool and whether it transfers.

7. Revision cost. Ask what one dimension change costs in money and days before you order, not after.